Alpha Natural Resources Does NOT Own Nearly Half of Rice Energy

It’s not often we get to set the record straight on a story run in the financial press–but we get to this time. A story appeared yesterday on the American Banking & Market News site that coal company Alpha Natural Resources (ANR), which has a joint venture with Rice Energy to drill in the Marcellus Shale, owns 42.8% of Rice Energy’s outstanding common shares of stock. Which made our eyeballs nearly fall out. How in the world could a coal company that filed for bankruptcy earlier this year (see Alpha Natural Resources in Bankruptcy – What about Marcellus?), own that much of Rice Energy? It made no sense to us. So we went digging. The story quotes from an extensive filing by ANR with the Securities and Exchange Commission. The 13D/A filing appears to make the claim that ANR owns 54,306,610 shares of Rice Energy (see below). However, if you read it closely, the language is dense and even misleading. We believe what it means to say is that ANR along with Rice Energy Holding, Rice Energy Family Holdings, and NGP Rice Holdings–all of them together–own 54,306,610 shares of stock. NOT just ANR by itself. We think the author of the story misinterpreted what is very obscure financial language. We reached out to Rice Energy and Rice’s president Toby Rice responded that he believes (is not 100% sure) that ANR owns less than 4 million shares of stock in Rice Energy

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